The Pioneering Space National Summit of 2015

by on Feb.21, 2015, under Change, Space Policy

In advance of several press releases, Op-Eds, and calls to action in the weeks to come, I want to join with colleague Rick Tumlinson​ to thank all those who participated in, supported, and will support the outcome of the Pioneering Space National Summit of 2015. Over 100 of the nation’s top government, science, engineering, industry and NGO leadership, Congressional staff and advocates from across the diverse human spaceflight community came together to build bridges and advance national space policy.  Together we forged a consensus statement.

It is but a first step.  The challenge – and the promise –  is what “we” – the large community, the nation –  will do with the gift.   More to come…

2015 PSNS Statement



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Valuation of “Big Problem” Startups Who Want to Change the World

by on Aug.20, 2014, under Entrepreneurship, Innovation, Technology, Valuation

A few hours after my last post on “Innovation at Escape Velocity”,  @TechCrunch posted a story on Y Combinator’s latest batch of startups.  “New At Y Combinator: Startups Solving Huge Problems!” featured a group of “Big Problem” companies taking aim at social, biotech, and energy issues. It also gave a preview of what Y Combinator is planning to do in this space – namely, bring on more of the same.

The growth and implementation bottlenecks I talked about in yesterday’s post include some that definitely qualify as Big Problems.  There are even a couple of intersections between my short list of examples and Y Combinators’s startups – energy, for one.  So it got my attention last night when TechCrunch’s @ryanlawler tweeted a note about the investor show-and-tell at Y Combinator:










Investors look at things like management team, culture, plan, and – oh yes – market cap.  Lots of them go with their gut, with their sense of what’s starting to roll, with what’s worked before, or with what analytics are telling them.  Now, some of them may be asking themselves, “Will these ‘tried and true’ methods work here? Or is there something fundamentally different about valuation of Big Problem startups?”

Most startup narratives are pretty linear: Innovation (idea) + tech + management + culture +  plan + investment + time + luck + penetration + acceptance + propagation = estimate of valuation/guesstimate of return.

But in the @ycombinator startup portfolio, the potential value of some startups is superlinear, multivariate, multiplicative – cascading across several different markets, social structures – even economies.  The assumption is always that value will be positive, but complex interactions could generate negative returns in some arenas and positive returns in others.  Valuation methods that take those interactions into account with even a little predictive validity would be a boon to startups, incubators, accelerators and investors alike.

In the short run it could be that none of this matters. Companies have a growth curve that requires funding to get from A to B no matter how big the idea is.  Y Combinator is focused on early-stage companies, and investors who focus on just that part of the curve might gravitate to companies with the right teams and energy.  More conservative types might jump into “BP” startups with tiered on/off ramps built into their offerings (for example) if they’re worried about whether the idea is “too big”.

Lucky for innovative visionaries, though, some investors look to the horizon.  Matching those investors to these sorts of companies is an evolving story, and it’s one that Y Combinator appears ready to help shape.  And they’re not alone.

But right now, these companies are the exception.  In a later tweet about the Y Combinator startups @ryanlawler mused “So, yeah, it’ll be interesting to see who steps up and writes them checks”.

Yeah.  It will.



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Innovation at Escape Velocity

by on Aug.18, 2014, under Commercial Space, Entrepreneurship, Innovation, Technology

Lately, I’ve taken the opportunity to scan the environment, peer at the future, and think about where current trends in business, government, technology, politics, economics and social organization are taking us.  After a few weeks, some things are bubbling to the surface, to wit:  The fundamental barriers or challenges to planning and execution of all “big idea” enterprises – exploring space, mitigating climate change, feeding people, controlling disease outbreaks, or conducting war for that matter –  have always been with us.  Technology hasn’t changed this fact – hasn’t fundamentally solved those challenges – just changed their format.  Here are a few of them:

  • How do we manage communications?
  • How do we manage logistics?
  • How do we manage energy?future-challenges-940x265
  • How do we manage financial systems?

These challenges and others form a kind of “box” that we’re constantly trying to get out of.   They act as bottlenecks to implementation, growth, and future development.  Innovations targeting these bottlenecks – particularly tech innovations that work across a variety of sectors, markets, and enterprises – are of very great value, highly attractiveto investors and entrepreneurs. In such circles the tech development cycle looks something like this, beginning with the challenge itself:

ChallengesChallenge/Barrier–> identify the right innovation–> valuation of innovation–> financing of innovation–> development and deployment of innovation–> propagation–> impact.

This begs the question posed by technology gurus, investors and policy wonks alike:

How do we identify which innovations will address or eliminate these challenges across enterprises/domains/sectors?

Getting the answer right is the bread and butter of venture capitalists.  Of course, VCs add “creation of value” and “exit” to the pathway…but right now I’m just talking about methods to capture and shepherd the first few steps of that cycle.

Actually, “capture” isn’t enough. “Accelerate” is key to the future, the honest-to-goodness innovation.   Finding a more reliable method to conceptualize challenges, identify the right innovation or candidate innovations, match them to a given enterprise or sets of enterprises or emerging markets os as to unleash growth and development, and then to accelerate that pathway – THAT’s the Holy Grail.

In human spaceflight, this type of thinking was behind the founding of SpaceX, started by Elon Musk with the initial goal of reducing cost per pound of cargo to orbit to $1000.00.  This figure is traceable back to a series of studies fostered by NASA and the DoD in the 1970’s through the 1990’s.   Those studies pointed to launch costs as the constraint holding back progress in the utilization and exploration of space.  A couple of studies closed in on $1000.00/lb as the inflection point.  If reliable transportation could be developed with transport prices below that threshold, it was believed that “the door would open” to Low Earth Orbit and beyond.  This became NASA’s “target figure”.

SpaceX took aim at that target. The goal drove much of the startup’s functioning for its first several years andfalcon_9_launch-2 remains a corporate target (along with others.) A second major goal was to accelerate development, taking advantage of rapid prototyping to compete in the marketplace as soon as possible and to speed a much broader availability of space transportation than had been available in the past both to commercial interests (satellite companies) and to citizens who could pay for the offering.

The demand side of the equation is also important in driving markets and determining the “best” innovations. The role of the International Space Station as “customer” for commercial space transportation services is a case-in-point.  For space transportation providers offering crew systems, there must be follow-on orbital platforms and new generations of paying customers to sustain them.  The key point is that while SpaceX’s innovations are not enough to “create” a market, they may enable one and spur additional, unforeseen innovations.  If so, Musk’s decision to target cost per pound to orbit could have impact for decades to come, auguring well for the company and for the space sector as a whole.  (As I was putting the final touches on this post TechCrunch reported that SpaceX is raising money at a corporate valuation nearing $10B.)

(Update 8/21/2014: Several news outlets reported yesterday that Space X responded to the @TechCrunch story in an email to Re/Code, denying that it is raising funds and indicating that no such valuation had been done.)

So how might this work with another bottleneck?  Taking “communications” as the example and using the logic described above, the entrepreneurial goal would be to identify, develop and deliver innovation(s) that remove communications barriers in big enterprises.  I’m thinking here about the Ebola outbreak management in Africa, underseas or energy (or space) exploration, international diplomacy, or its opposite – war, or… social organization.

The “best” innovation(s) in communications should address three major requirements: (a) overcome or mitigate the effects of physical distance, (b) minimize or eliminate opportunities for interference, and (c) operate in such a way that language differences are irrelevant to understanding.  Overcoming_Barriers-300x285With regard to social organization we have seen such an an innovation: Facebook has made great strides in (a) and (b) above and is working on (c). Not coincidentally, it also has 1 billion users, a market cap approaching $200B, and is stimulating new development in gamespaces, marketing, value-added technology development, and other social media platforms.  It has also reconnected families, friends, generated new social circles, and arguably may serve as a platform for new types of democratic interaction and reform in the future.

What would happen to innovation spaces, to technology development, to businesses, to governments, and to social structures if we could more reliably identify and shepherd innovation(s) that would remove communication as a barrier across multiple enterprises?

Returning to the short list of challenges at the beginning of this post, and recognizing there are many more, what if we could more reliably identify and speed innovation across many of these barriers, across multiple arenas of human endeavor?  What then, of the box?

Escape Velocity

Whole consulting sectors are dedicated to finding this answer and marketing it for businesses, but I’m interested in the social questions as well as the economic ones. 

Escape velocity.  That’s the goal.  I’m spending most of my time thinking about it, and welcome your thoughts and comments.

Follow me on Twitter @DittmarML
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